Energy Terms

Energy Terms

Let us shed some light on Energy Industry terminology.

We have supplied our customers with these energy terms to help them to educate them selves so they are aware of the “ins and outs” of their energy plan. With this information our customers can become energy experts, making wiser choices when it comes to the energy they use.

The actual reduction in annual peak load (measured in kilowatts) achieved by consumers that participate in a utility Demand Side Management (DSM) program. It reflects the real changes in the demand for electricity resulting from a utility DSM program that is in effect at the same time the(...)

Ancillary Services are necessary services that must be provided in the generation and delivery of electricity. As defined by the Federal Energy Regulatory Commission,they include: coordination and scheduling services (load following, energy imbalance service, control of transmission(...)

The average revenue per kilowatt-hour of electricity sold by sector (residential, commercial, industrial, or other) and geographic area (State, Census division, and national) is calculated by dividing the total monthly revenue by the corresponding total monthly sales for each sector and(...)

The cost to the utility if it had generated or otherwise purchased the power. It is a benchmark price for energy services, used to compare resource alternatives. Avoided cost is the marginal long-term or short-term production cost that could be avoided by an alternative supply-side or(...)

A plant, usually housing high-efficiency steam-electric units, which is normally operated to take all or part of the minimum load of a system, and which consequently produces electricity at an essentially constant rate and runs continuously. These units are operated to maximize system(...)

Basis is the differential that exists between the future price for a given commodity and the Cash or Spot price for the same or related commodity. Basis may reflect different time periods, product forms, qualities or locations. Cash minus Futures equals Basis.

Biomass is an organic non-fossil material of biological origin constituting a renewable energy source such as energy derived from plants. Alcohol fuels are produced from wood, sugarcane and corn. Firewood, crop residue and cattle dung can also be burned.

British Thermal Unit (BTU) is a standard unit of energy which is a common measure of heating value for different fuels. One Btu is equal to the amount of heat required to raise the temperature of one pound of liquid water by 1 degree Fahrenheit at its maximum density, which occurs at a(...)

A broker is a retail agent who arranges or negotiates for the purchase and sale of electricity or natural gas. Brokers usually act on the behalf of others and do not buy energy for their own end-use customers

British Thermal Unit (BTU) is a standard unit of energy which is a common measure of heating value for different fuels. One Btu is equal to the amount of heat required to raise the temperature of one pound of liquid water by 1 degree Fahrenheit at its maximum density, which occurs at a(...)

The California Power Exchange Corporation (a.k.a. “CPX”), a State chartered, non-profit corporation charged with providing DayAhead and Hour-Ahead markets for energy and ancillary services, if it chooses to self-provide, in accordance with the power exchange tariff. The power exchange is a(...)

Capability is the maximum load that a generating unit, generating station, or other electrical apparatus can carry under specified conditions for a given period of time without exceeding approved limits of temperature and stress.

Capacity Charge is an element in a two-part pricing method used in capacity transactions (energy charge is the other element). The capacity charge, sometimes called Demand Charge, is assessed on the amount of capacity being purchased.

Cooperative (Co-Op) Rural electric cooperatives generate and/or purchase wholesale power, arrange for the transmission of that power, and then distribute the power to serve the demand of rural customers. Co-ops typically become involved in ancillary services such as energy conservation, load(...)

Combined Cycle is an electric generating technology in which electricity is produced from otherwise lost waste heat exiting from one or more gas (combustion) turbines. The exiting heat is routed to a conventional boiler or to a heat recovery steam generator for utilization by a steam turbine(...)

Combined Cycle Unit is an electric generating unit that consists of one or more combustion turbines and one or more boilers with a portion of the required energy input to the boiler(s) provided by the exhaust gas of the combustion turbine(s).

Competitive Power Suppliers are companies that sell power - also called electricity providers, power generators or energy marketers. Your power is delivered by the local electric utility/distribution company (DISCO).

Competitive Transition Charge also know as CTC, is a non-bypassable charge levied on each customer of a distribution utility, including those who are served under contracts with non-utility suppliers, for recovery of a utility’s transition costs.

Contract for Differences is a financial instrument used to hedge against the daily or hourly fluctuating prices that would be offered by an ISO or a “power exchange.” A customer would be able to purchase a financial hedge from another party who may or may not have contractual rights to any(...)

Contract Price is the price of goods marketed on a contract basis covering a period of 1 or more years. Contract prices reflect market conditions at the time the contract was negotiated and therefore remain constant throughout the life of the contract or are adjusted through escalation(...)

Control Area is an electric power system or combination of electric power systems to which a common automatic control scheme is applied in order to: (1) match, at all times, the power output of the generators within the electric power system(s) and capacity and energy purchased from entities(...)

Cooperative (Co-Op) Rural electric cooperatives generate and/or purchase wholesale power, arrange for the transmission of that power, and then distribute the power to serve the demand of rural customers. Co-ops typically become involved in ancillary services such as energy conservation, load(...)

Competitive Transition Charge also know as CTC, is a non-bypassable charge levied on each customer of a distribution utility, including those who are served under contracts with non-utility suppliers, for recovery of a utility’s transition costs.

Cubic Foot is the most common unit of measurement of natural gas volume. It is the amount of gas that can fit within a space one foot times one foot times one foot in volume. One cubic foot of pipeline-quality gas contains approximately 1,000 BTU.

Customer Charge is part of the monthly basic distribution charge to partially cover costs for billing, meter reading equipment, service line maintenance and equipment. This charge is the same no matter how much electricity you use.

Customer Choice is the freedom for a retail customer to purchase electric services, either individually or through voluntary aggregation with other retail customers, from the provider(s) of the customer’s choice and to choose among various fuel types, energy efficiency programs, and renewable(...)

Day-Ahead Market is the forward market for energy and ancillary services to be supplied during the settlement period of a particular trading day that is conducted by the Independent System Operator, the power exchange, and other Scheduling Coordinators. This market closes with the Independent(...)

A Day-Ahead Schedule is a schedule prepared by a Scheduling Coordinator or the Independent System Operator before the beginning of a trading day. This schedule indicates the levels of generation and demand scheduled for each settlement period that trading day.

Default Service is when the electric generation service provided to any consumer who does not or is unable to arrange for or maintain electric generation services with an electric supplier after deregulation begins.

Degree Day is a day when the measure of the coldness of the weather (heating degree day) or its heat (cooling degree day) based on the extent to which the daily mean temperature falls below or rises above 65 degrees Fahrenheit.

Demand-Side Management is the planning, implementation, and monitoring of utility activities designed to encourage consumers to modify patterns of electricity usage, including the timing and level of electricity demand.

Electric Rate Schedule is a statement of the electric rate and the terms and conditions governing its application, including attendant contract terms and conditions that have been accepted by a regulatory body with appropriate oversight authority.

Electric Utility, when any person or state agency with a monopoly franchise (including any municipality) that sells electric energy to end-use customers. End-Use The ultimate use to which energy service is put, such as water heating and air conditioning.

Electricity Generation is the process of producing electric energy or transforming other forms of energy into electric energy. Also, the amount of electric energy produced or ex-pressed in watt-hours (Wh).

Electricity Supplier is an entity (including an energy marketer or energy services company – or ESCO) licensed or approved by a state utility regulatory agency to provide electricity supply to consumers. With energy choice, consumers can choose their electric supplier. The energy is then(...)

Energy Conservation is when actions that are taken to reduce or manage energy consumption in a cost-effective and efficient manner. Methods of reducing energy include using insulation, increasing energy efficiency and changing patterns of use.

Energy Consumption is the use of energy as a source of heat or power or as an input in the manufacturing process. Energy consumption determined by multiplying the demand by the time period over which the energy was used. The kilowatt-hour is the typical unit of measure for energy consumption.

Energy Efficiency Programs refers to programs that are aimed at reducing the energy used by specific enduse devices and systems, typically without affecting the services provided. These programs reduce overall electricity consumption (reported in megawatt or kilowatt hours), often without(...)

The Energy Policy Act (EPACT) of 1992 addresses a wide variety of energy issues. The legislation creates a new class of power generators, exempt wholesale generators, that are exempt from the provisions of the Public Holding Company Act of 1935 and grants the authority to the Federal Energy(...)

Energy Source is the primary source that provides the power that is converted to electricity through chemical, mechanical, or other means. Energy sources include coal, petroleum and petroleum products, gas, water, uranium, wind, sunlight, geothermal, and other sources.

Exempt Wholesale Generator was created under the 1992 Energy Policy Act, these wholesale generators are exempt from certain financial and legal restrictions stipulated in the Public Utilities Holding Company Act of 1935.

The Federal Energy Regulatory Commission (FERC) regulates the price, terms and conditions of natural gas and electricity sold in interstate commerce and regulates the price, terms and conditions of all wholesale transactions. FERC is the federal counterpart to state utility regulatory commissions.

The Federal Energy Regulatory Commission (FERC) regulates the price, terms and conditions of natural gas and electricity sold in interstate commerce and regulates the price, terms and conditions of all wholesale transactions. FERC is the federal counterpart to state utility regulatory commissions.

Firm Service is the highest quality of sales or transmission service offered to customers under a led rate schedule that anticipates no planned interruption. It also receives the highest priority of service.

Forced Outage is the shutdown of a generating unit, transmission line or other facility, for emergency reasons or a condition in which the generating equipment is unavailable for load due to unanticipated breakdown.

Fuel Chain is the chain of activities involved in transforming energy into forms more convenient for society. This chain may include some or all of the following: fuel exploration, extraction, preparation, transportation, conversion to electricity, distribution and waste disposal.

Fuel Expenses are the costs that include the fuel used in the production of steam or driving another prime mover for the generation of electricity. Other associated expenses include unloading the shipped fuel and all handling of the fuel up to the point where it enters the first bunker,(...)

Futures Market Arrangement through a contract for the delivery of a commodity at a future time and at a price specified at the time of purchase. The price is based on an auction or market basis. This is a standardized, exchange-traded, and government regulated hedging mechanism.

Gas Turbine Plant is a plant in which the prime mover is a gas turbine. A gas turbine consists typically of an axial-ow air compressor, one or more combustion chambers, where liquid or gaseous fuel is burned and the hot gases are passed to the turbine and where the hot gases expand to drive(...)

Generation Company is a regulated or non-regulated entity (depending upon the industry structure) that operates and maintains existing generating plants. The generation company may own the generation plants or interact with the short-term market on behalf of plant owners. In the context of(...)

Worry-Free Fixed is a fixed rate electricity supply plan from Energy Me. When customers enroll in a worry-free fixed plan they experience comfort knowing that they have securely locked-in their electricity supply rate for the term they chose. When that particular term is up, the customer then(...)

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Energy Me is an independent retail supplier of electricity. We are not affiliated with, nor endorsed by, any local utility or state commission. Energy Me is licensed to sell electricity in the state of Delaware (Docket 13-316), District of Columbia (Electric License: EA 2013-16), Maryland (Electric-IR-2820), Ohio (Electric License: 12-1972-EL-CRS), Pennsylvania (Electric License: A-2012-2327584), Illinois, New Jersey (Electric License: ESL-0158). Energy Me does not guarantee any savings.